Transferable discharge permits (TDP) can be used to achieve desired abatement levels at costs that approach the minimum. The emphasis in the discussion is on the implementation of such a system, the public choice problem in its adoption, and an assurance that regardless of which polluters provide waste treatment there is a mechanism for equitable sharing in the costs of that abatement. The argument is applied to phosphorUs abatement in the Wisconsin portion of the Lake Michigan basin. The level of demand and supply for TDP's among 53 waste treatment plants is simulated, and the necessary steps to create a market are outlined. Enforcement, price changes, and future adjustments in the permissible effluent loading are shown to be compatible with the marketing process proposed.Marketable permits, called transferable discharge permits or TDP's, can be used to achieve any desired level of air or water pollution abatement. The emphasis in the discussion in this paper is on the implementation of such a system, the public choice problem in its adoption, and an assurance that regardless of which polluters provide waste treatment there is a mechanism for equitable sharing in the cos ts of that abatement. This paper examines the problems and practicalities of establishing a system of waste load allowances which is both more equitable and more efficient than direct regulation. Although the example we use is the treatment of waste water for phosphorus removal, the same principles apply to waste water and air pollution generally. We conclude that a marketable permit system is a viable alternative to direct regulation, once a total allowable loading to the waterway or air shed is established and an initial allocation of permitted discharges made.Although there are political hurdles which economists must recognize, they do not appear insurmountable. It is apparent, however, that strategies which ignore them are unlikely to succeed.As Tietenberg [1974] points out in his excellent article on the use of marketable permits for air pollution control (emission offsets), reCognition that economic efficiency in abatement could be achieved by establishing marketable permits has .not been .accompanied by discussion of the practical problems involved in 'unplernemation. (Only Tietenberg [ 1974], de-Lucia [1974], and Scott' and .Bransen [1974] have made serious efforts in that direction.) Dales [1968] discusses the general strategy of marketable permits.A marketable permit is not an effluent charge. Unlike the effluent charge, it does not purport to solve the problems of

A developing understanding of instream flow needs now supports maintenance of ecological flow regimes rather than a fixed, time-invariant regulatory minimum flow. This shift is reflected in management of streamflow change created by existing reservoirs and flow diversion structures. With an emphasis on regime-based approaches a new connectivity is demanded between reservoir operations and the resulting downstream flow conditions. Complicating this situation is reservoir management that may be legally limited to flood control and water supply requirements reducing options for supplying downstream needs. This paper proposes an approach to reservoir operation that is based on ecological flow regime concepts. Reservoir operation is guided by six hydrologic indicators selected both to meet the specific flow needs of the local indigenous fish community and to satisfy authorized reservoir operational rules. The approach is based on incorporation of ecology and life history requirements of the fish community in the decision making process to better define and meet flow needs. Optimization using nondominated sorting genetic algorithms provides a basis for reservoir operational schemes that are expected to provide benefit to fish communities downstream while also meeting authorized reservoir storage needs.

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